Summary: The goal of this project is to decipher molecular signaling mechanisms for control of insulin biosynthesis and secretion, and the immediate focus is on dissecting the function of Shp2 tyrosine phosphatase in orchestrating signaling cascades in cells. Although pancreatic cell failure is a critical component in all forms of diabetes, the molecular basis underlying cell dysfunction is poorly understood. This is mainly because that little is known for the cytoplasmic components mediating glucose and insulin signals in -cells. Shp2 is a cytoplasmic tyrosine phosphatase with two SH2 domains that is implicated in regulation and coordination of signaling pathways. In particular, Shp2 has been shown to promote insulin-stimulated Erk activation in vitro, although the physiological significance of Shp2 function in insulin signaling is unclear. In recent studies, we have successfully created a conditional Shp2 knockout allele, Shp2flox, in mice, which allows us to investigate specific Shp2 functions in a specific cell type or tissue in vivo. We have generated mutant mice with Shp2 deleted in mature -cells or in Pdx1+ pancreatic precursor cells, and will characterize these novel mouse models to test the working hypothesis that Shp2 acts to coordinate and control the strength of several signaling pathways in orchestrating insulin biosynthesis and secretion in -cells. In complement with the gene targeting approach in vivo, we will also use siRNA- mediated gene knockdown technique to decipher the molecular signaling mechanisms in cells. Our specific aims are: 1) to determine the physiological role of Shp2 in -cell function and glucose homeostasis; 2) to dissect the molecular mechanism for Shp2 action in -cells; and 3) to investigate the Shp2 function in pancreatic development and -cell regeneration. Successful completion of the proposed experiments will fill in a gap in our knowledge for coordinated regulation of cytoplasmic signaling events in -cells, and may even lead to a new paradigm on regulation of -cell functions in glucose homeostasis and also in pathogenesis of type 2 diabetes.